News

Unjustified Price Cuts Harming Farmers

18 July 2013

IRELAND - IFA National Livestock Chairman Henry Burns has hit out strongly at the meat factories accusing them of imposing serious income damage of livestock farmers with their unjustified price cutting tactics over the last four weeks.

At a time when cattle supplies are tight and prices in our main export market in the UK are very solid at close to €5.00/kg, he said the price cutting tactics of the Irish factories cannot be justified. He said the factories have pulled prices by 30c/kg or €110 per in the last few weeks. Over the national kill of 1.5million cattle, this magnitude of price cut would amount to €165m out of farmers’ pockets in a full year.

The IFA Livestock Chairman said there is rising anger among beef farmers with the way the factories are treating them on price. He said factory representatives are threatening farmers that if they don’t take the lower quoted prices they will pull prices further in the next few weeks. "Farmers are very angry with this type of exploitation from factories."

Mr Burns said the income damage being inflicted by the meat plants on livestock farmers after one of the most difficult fodder crisis in living memory is very severe. He said after last winter and spring farmers have massive bills to pay for feed and fodder. He said they desperately need a period of stable and profitable cattle prices in line with the returns from our key premium market in the UK.

The IFA Livestock Chairman said the way the factories have stymied competition in the beef price shows the urgent need for more live exports in the beef sector. He called on Minister Coveney to get more boats and more live exports flowing to international markets. He also called on Minister Coveney to take immediate action at opening up the live export trade to the UK and instil some real competition into the livestock sector.

Mr Burns said despite the propaganda from the factories, the cattle supply situation is very tight, demand is very strong and farmers should not part with cattle easily. He said the facts are there is a massive shortage of beef in the UK and demand remains very strong. Mr Burns said the factories would be much better employed in trying to maximise this opportunity as opposed to inflicting heavy price cuts on farmers.

Mr Burns said IFA is working hard to increase the live trade to the UK and open up more competition in the beef trade. He said, "Ireland has the best beef and cattle trade in the world on our doorstep in the UK market and we need to maximise the full potential of this market which is paying €5.00/kg for cattle."

Mr Burns said in the Food Harvest 2020 plan, factories claimed they wanted to increase beef production and they claimed they could easily sell 40,000 cattle per week. He said in the last 3 weeks procurement managers and agents are telling farmers they are full up of cattle, although the kill is less than 28,000 head. He said the reality is the factories are limiting the kill and backing up numbers in order to pull back prices.